Vodafone to pay shareholder dividend, despite O2 and Virgin Media merger
Vodafone Group’s CEO said that it had more than enough financial headroom to pay the dividend and invest in capital expenditure projects across Europe
Vodafone Group has confirmed that it will pay a dividend of £0.08 per share, despite the news of the merger between O2 and Virgin Media in the UK.
The merger, which was announced last week, had led some analysts to speculate that Vodafone may pass on this year’s dividend in order to beef up its capital investment war chest, in order to compete with the newly merged entity.
However, Vodafone Group CEO, Nick Read, told journalists on an earnings call this week that the company had “good headroom” to compete against the newly merged O2.
In the UK, Vodafone UK’s CEO, Nick Jeffrey, said that the company had already laid the foundations for bringing next generation connectivity to the UK, adding that those foundations had equipped Vodafone with the necessary capacity to deal with the surge in demand bought about by the current Coronavirus pandemic.
“Despite internet traffic increasing 30 per cent during the lockdown period and voice calls rising 50 per cent, our network has coped brilliantly. We’ve been able to keep the UK connected at a time when the country needed us the most,” he said.
“We responded magnificently in a crisis, transforming Vodafone UK into a ‘working from home’ company in just a few weeks while maintaining good customer service levels and operational performance. We’ve provided connectivity to hospitals up and down the country, including the temporary COVID-19 Nightingale hospitals.
“Because Vodafone UK is now financially and operationally strong, we’ve been able to offer our fantastic NHS and care home workers six months’ free unlimited data. We’ve been able to extend the same offer to our vulnerable customers, too, putting our spare network capacity to good use at a time when the UK needs it the most,” he added.